UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                    FORM 10-Q

     [X]     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934


       For the Quarter Ended June 30, 2008. Commission File Number 1-9720

                                       OR
               [ ] TRANSITION REPORT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934


             For the Transition Period From __________ to __________
                        Commission File Number __________

                           PAR TECHNOLOGY CORPORATION
             (Exact name of registrant as specified in its charter)

           Delaware                                    16-1434688
(State or other jurisdiction of         (I.R.S. Employer Identification Number)
incorporation or organization)

     PAR Technology Park
     8383 Seneca Turnpike
     New Hartford, NY                                  13413-4991
(Address of principal executive offices)                (Zip Code)

     Registrant's telephone number, including area code: (315) 738-0600

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. Yes [X]  No [  ]

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated  filer, a non-accelerated  filer, or a smaller reporting company.
See the definitions of "large  accelerated  filer" and  "accelerated  filer" and
"smaller reporting company" in Rule 12b-2 of the Exchange Act.

     (Check  one):   Large   Accelerated   Filer  [  ]  Accelerated   Filer  [X]
Non-Accelerated  Filer [ ]  Smaller  Reporting  Company  [ ] (Do not  check if a
smaller reporting company)

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined in Rule 12b-2 of the Exchange Act). Yes [  ]  No [x]

     The number of shares  outstanding of registrant's  common stock, as of July
31, 2008 - 14,455,063 shares.

<PAGE>
                           PAR TECHNOLOGY CORPORATION


                                TABLE OF CONTENTS
                                    FORM 10-Q


                                     PART I
                              FINANCIAL INFORMATION


   Item Number
   -----------

      Item 1.    Financial Statements (unaudited)

                 -  Consolidated Statements of Operations for
                    the three and six months ended June 30, 2008 and 2007

                 -  Consolidated Statements of Comprehensive Income (Loss)
                    for the three and six months ended June 30, 2008 and 2007

                 -  Consolidated Balance Sheets at
                    June 30, 2008 and December 31, 2007

                 -  Consolidated Statements of Cash Flows
                    for the six months ended June 30, 2008 and 2007

                 -  Notes to Unaudited Interim Consolidated Financial Statements

      Item 2.    Management's Discussion and Analysis of
                 Financial Condition and Results of Operations

      Item 3.    Quantitative and Qualitative Disclosures About Market Risk

      Item 4.    Controls and Procedures

                                     PART II
                                OTHER INFORMATION


      Item 1A.   Risk Factors

      Item 4.    Submission of Matters to a Vote of Security Holders

      Item 5.    Other Information

      Item 6.    Exhibits

      Signatures

      Exhibit Index

<PAGE>
                         PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

<TABLE>
<CAPTION>


                   PAR TECHNOLOGY CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    (in thousands, except per share amounts)
                                   (unaudited)

                                                       For the three months      For the six months
                                                           ended June 30,           ended June 30,
                                                      ----------------------    ----------------------
                                                         2008         2007        2008          2007
                                                      ---------    ---------    ---------    ---------
<S>                                                   <C>          <C>          <C>          <C>
Net revenues:
     Product ......................................   $  20,751    $  18,320    $  37,648    $  35,026
     Service ......................................      17,729       16,100       34,144       31,629
     Contract .....................................      18,754       15,452       37,549       31,053
                                                      ---------    ---------    ---------    ---------
                                                         57,234       49,872      109,341       97,708
                                                      ---------    ---------    ---------    ---------
Costs of sales:
     Product ......................................      12,612       10,699       22,037       21,007
     Service ......................................      12,877       11,886       25,360       24,052
     Contract .....................................      17,713       14,652       35,553       29,206
                                                      ---------    ---------    ---------    ---------
                                                         43,202       37,237       82,950       74,265
                                                      ---------    ---------    ---------    ---------
           Gross margin ...........................      14,032       12,635       26,391       23,443
                                                      ---------    ---------    ---------    ---------
Operating expenses:
     Selling, general and administrative ..........       8,742        9,186       17,803       17,895
     Research and development .....................       3,890        4,387        8,011        8,201
     Amortization of identifiable intangible assets         389          394          779          784
                                                      ---------    ---------    ---------    ---------
                                                         13,021       13,967       26,593       26,880
                                                      ---------    ---------    ---------    ---------

Operating income (loss) ...........................       1,011       (1,332)        (202)      (3,437)
Other income, net .................................         229          154          543          394
Interest expense ..................................        (121)        (237)        (470)        (459)
                                                      ---------    ---------    ---------    ---------
Income (loss) before provision for income taxes ...       1,119       (1,415)        (129)      (3,502)
(Provision) benefit for income taxes ..............        (445)         394           58        1,173
                                                      ---------    ---------    ---------    ---------
Net income (loss) .................................   $     674    $  (1,021)   $     (71)   $  (2,329)
                                                      =========    =========    =========    =========
Earnings (loss) per share
     Basic ........................................   $     .05    $    (.07)   $    (.00)   $    (.16)
     Diluted ......................................   $     .05    $    (.07)   $    (.00)   $    (.16)
Weighted average shares outstanding
     Basic ........................................      14,394       14,348       14,386       14,334
                                                      =========    =========    =========    =========
     Diluted ......................................      14,798       14,348       14,386       14,334
                                                      =========    =========    =========    =========
</TABLE>



See notes to unaudited interim consolidated financial statements


<PAGE>
<TABLE>
<CAPTION>

                   PAR TECHNOLOGY CORPORATION AND SUBSIDIARIES
             CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
                                 (in thousands)
                                   (unaudited)

                                                       For the three months      For the six months
                                                           ended June 30,           ended June 30,
                                                      ----------------------    ----------------------
                                                         2008         2007        2008          2007
                                                      ---------    ---------    ---------    ---------

<S>                                                   <C>          <C>          <C>          <C>
Net income (loss) .................................   $     674    $  (1,021)   $     (71)   $  (2,329)
Other comprehensive income, net of tax:
     Foreign currency translation adjustments .....         140          613           36          529
                                                      ---------    ---------    ---------    ---------

Comprehensive income (loss) .......................   $   814      $    (408)   $     (35)   $  (1,800)
                                                      =========    =========    =========    =========


</TABLE>









See notes to unaudited interim consolidated financial statements

<PAGE>


                   PAR TECHNOLOGY CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                      (in thousands, except share amounts)
                                   (unaudited)

                                                         June 30,  December 31,
                                                            2008       2007
                                                         ---------  -----------
Assets
Current assets:
     Cash and cash equivalents .........................  $   3,357   $   4,431
     Accounts receivable-net ...........................     45,568      43,608
     Inventories-net ...................................     40,808      40,319
     Income tax refunds ................................      1,352         521
     Deferred income taxes .............................      5,039       5,630
     Other current assets ..............................      3,454       3,370
                                                          ---------   ---------
         Total current assets ..........................     99,578      97,879
Property, plant and equipment - net ....................      7,401       7,669
Deferred income taxes ..................................        443         503
Goodwill ...............................................     26,798      26,998
Intangible assets - net ................................      9,263       9,899
Other assets ...........................................      1,978       3,570
                                                          ---------   ---------
              Total Assets .............................  $ 145,461   $ 146,518
                                                          =========   =========
Liabilities and Shareholders' Equity
Current liabilities:
     Current portion of long-term debt .................  $     917   $     772
     Borrowings under lines of credit ..................      7,862       2,500
     Accounts payable ..................................     11,746      16,978
     Accrued salaries and benefits .....................      9,286       9,919
     Accrued expenses ..................................      3,241       3,860
     Customer deposits .................................      4,089       3,898
     Deferred service revenue ..........................     14,260      14,357
                                                          ---------   ---------
         Total current liabilities .....................     51,401      52,284
                                                          ---------   ---------
 Long-term debt ........................................      6,430       6,932
                                                          ---------   ---------
Other long-term liabilities ............................      2,319       2,315
                                                          ---------   ---------
Shareholders' Equity:
     Preferred stock, $.02 par value,
       1,000,000 shares authorized .....................       --          --
     Common stock, $.02 par value,
       29,000,000 shares authorized;
       16,098,818 and 16,047,818 shares issued;
       14,446,063 and 14,395,063 outstanding ...........        322         321
     Capital in excess of par value ....................     39,610      39,252
     Retained earnings .................................     50,380      50,451
     Accumulated other comprehensive income ............        508         472
     Treasury stock, at cost, 1,652,755 shares .........     (5,509)     (5,509)
                                                          ---------   ---------
         Total shareholders' equity ....................     85,311      84,987
                                                          ---------   ---------
              Total Liabilities and Shareholders' Equity  $ 145,461   $ 146,518
                                                          =========   =========



See notes to unaudited interim consolidated financial statements
<PAGE>
<TABLE>
<CAPTION>


                   PAR TECHNOLOGY CORPORATION AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                   (unaudited)
                                                                         For the six months ended June 30,
                                                                         ---------------------------------
                                                                                   2008       2007
                                                                                 --------   --------
<S>                                                                              <C>        <C>
Cash flows from operating activities:
    Net loss .................................................................   $   (71)   $(2,329)
    Adjustments to reconcile net loss to net cash
      provided by (used in) operating activities:
         Depreciation and amortization .......................................     2,045      1,955
         Provision for bad debts .............................................        48      1,066
         Provision for obsolete inventory ....................................       731        663
         Equity based compensation ...........................................       164        271
         Deferred income tax .................................................       692     (1,620)
         Changes in operating assets and liabilities:
             Accounts receivable .............................................    (2,008)     6,158
             Inventories .....................................................    (1,220)    (2,727)
             Income tax refunds ..............................................      (831)       746
             Other current assets ............................................       (84)      (137)
             Other assets ....................................................        21       (529)
             Accounts payable ................................................    (5,232)    (2,574)
             Accrued salaries and benefits ...................................      (633)      (301)
             Accrued expenses ................................................      (463)       148
             Customer deposits ...............................................       191        313
             Deferred service revenue ........................................       (97)        88
             Other long-term liabilities .....................................         4        715
                                                                                 -------    -------
               Net cash provided by (used in) operating activities ...........    (6,743)     1,906
                                                                                 -------    -------
Cash flows from investing activities:
    Capital expenditures .....................................................      (695)      (649)
    Capitalization of software costs .........................................      (487)      (730)
    Contingent purchase price paid on prior year acquisitions ................      (156)        --
    Cash received from voluntary conversion of long-lived other assets .......     1,571         --
                                                                                 -------    -------
               Net cash provided by (used in) investing activities ...........       233     (1,379)
                                                                                 -------    -------
Cash flows from financing activities:
    Net borrowings under line-of-credit agreements ...........................     5,362     (1,670)
    Payments of long-term debt ...............................................      (357)       (49)
    Proceeds from the exercise of stock options ..............................       195        109
                                                                                 -------    -------
               Net cash provided by (used in) financing activities ...........     5,200     (1,610)
                                                                                 -------    -------
Effect of exchange rate changes on cash and cash equivalents .................       236        130
                                                                                 -------    -------
Net decrease in cash and cash equivalents ....................................    (1,074)      (953)
Cash and cash equivalents at beginning of period .............................     4,431      4,273
                                                                                 -------    -------
Cash and cash equivalents at end of period ...................................   $ 3,357    $ 3,320
                                                                                 =======    =======
Supplemental disclosures of cash flow information:
Cash paid during the period for:
    Interest .................................................................   $   451    $   474
    Income taxes, net of refunds .............................................        (1)      (331)
</TABLE>


See notes to unaudited interim consolidated financial statements


<PAGE>


                   PAR TECHNOLOGY CORPORATION AND SUBSIDIARIES
          NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS


1.   The accompanying  unaudited interim consolidated  financial statements have
     been prepared by PAR  Technology  Corporation  (the  "Company" or "PAR") in
     accordance with U.S. generally accepted  accounting  principles for interim
     financial  statements and with the instructions to Form 10-Q and Regulation
     S-X pertaining to interim financial statements.  Accordingly, these interim
     financial  statements do not include all information and footnotes required
     by U.S.  generally  accepted  accounting  principles for complete financial
     statements.  In the  opinion  of the  Company,  such  unaudited  statements
     include all  adjustments  (which comprise only normal  recurring  accruals)
     necessary  for a fair  presentation  of the results for such  periods.  The
     results of operations  for the three and six months ended June 30, 2008 are
     not necessarily  indicative of the results of operations to be expected for
     any future period. The consolidated  financial statements and notes thereto
     should  be read in  conjunction  with the  audited  consolidated  financial
     statements  and notes for the year ended  December 31, 2007 included in the
     Company's  December 31, 2007 Annual Report to the  Securities  and Exchange
     Commission on Form 10-K.

     The preparation of consolidated financial statements requires management of
     the Company to make a number of estimates and  assumptions  relating to the
     reported amounts of assets and liabilities and the disclosure of contingent
     assets and liabilities at the date of the consolidated financial statements
     and the  reported  amounts of  revenues  and  expenses  during the  period.
     Significant  items subject to such estimates and assumptions  include:  the
     carrying amount of property,  plant and equipment,  identifiable intangible
     assets and goodwill,  equity based compensation,  and valuation  allowances
     for  receivables,  inventories  and deferred  income taxes.  Actual results
     could differ from those estimates.

2.   Inventories   are  primarily  used  in  the   manufacture  and  service  of
     Hospitality products. The components of inventory, net of related reserves,
     consist of the following:

                                     (in thousands)
                                 June 30,     December 31,
                                   2008           2007
                                 --------       --------

          Finished goods         $ 9,510        $ 9,965
          Work in process          1,935          1,722
          Component parts         10,579         10,408
          Service parts .         18,784         18,224
                                 -------        -------
                                 $40,808        $40,319
                                 =======        =======

     At June 30, 2008 and December 31, 2007,  the Company had recorded  reserves
     for shrinkage,  excess and obsolete inventory of $3,768,000 and $3,951,000,
     respectively.

3.   Effective  January 1, 2006, the Company adopted the fair value  recognition
     provisions of Statement of Financial  Accounting  Standards (SFAS) No. 123R
     Share-Based  Payment  (SFAS  123R) on a modified  prospective  basis.  This
     standard  requires  the Company to measure  the cost of  employee  services
     received in exchange  for equity  awards based on the grant date fair value
     of the awards.  The cost is  recognized  as  compensation  expense over the
     vesting  period of the  awards.  Total  compensation  expense  included  in
     operating  expenses  for the three and six months  ended June 30,  2008 was

<PAGE>

     $60,000 and $164,000,  respectively. Total compensation expense included in
     operating  expenses  for the three and six months  ended June 30,  2007 was
     $134,000 and $271,000,  respectively.  At June 30, 2008,  the  unrecognized
     compensation  expense related to non-vested option awards was $548,000 (net
     of  estimated   forfeitures)   which  is  expected  to  be   recognized  as
     compensation expense in fiscal years 2008 through 2012.

4.   Earnings per share are calculated in accordance with Statement of Financial
     Accounting  Standards  No. 128,  Earnings per Share,  which  specifies  the
     computation,  presentation  and  disclosure  requirements  for earnings per
     share (EPS).  It requires the  presentation of basic and diluted EPS. Basic
     EPS excludes all dilution and is based upon the weighted  average number of
     common  shares  outstanding  during the period.  Diluted EPS  reflects  the
     potential  dilution that would occur if  securities  or other  contracts to
     issue common stock were exercised or converted into common stock.

     The  following  is  a   reconciliation   of  the  weighted  average  shares
     outstanding  for the basic and  diluted  EPS  computations  (in  thousands,
     except per share data):

                                                        For the three months
                                                           ended June 30,
                                                        --------------------
                                                          2008        2007
                                                        --------    --------
Net income (loss) ...................................   $    674    $ (1,021)
                                                        ========    ========
Basic:
     Shares outstanding at beginning of period ......     14,382      14,343
     Weighted average shares issued during the period         12           5
                                                        --------    --------
     Weighted average common shares, basic ..........     14,394      14,348
                                                        ========    ========
     Earnings (loss) per common share, basic ........   $    .05    $   (.07)
                                                        ========    ========
Diluted:
     Weighted average common shares, basic ..........     14,394      14,348
     Weighted average shares issued during the period         11        --
     Dilutive impact of restricted stock awards .....         17        --
     Unamortized compensation expense ...............        (18)       --
     Dilutive impact of stock options ...............        394        --
                                                        --------    --------
     Weighted average common shares, diluted ........     14,798      14,348
                                                        ========    ========
     Earnings (loss) per common share, diluted ......   $    .05    $   (.07)
                                                        ========    ========


                                                         For the six months
                                                           ended June 30,
                                                        --------------------
                                                           2008       2007
                                                        --------    --------
Net income (loss) ...................................   $    (71)   $ (2,329)
                                                        ========    ========
Basic:
     Shares outstanding at beginning of period ......     14,372      14,310
     Weighted average shares issued during the period         14          24
                                                        --------    --------
     Weighted average common shares, basic ..........     14,386      14,334
                                                        ========    ========
     Earnings (loss) per common share, basic ........   $   (.00)   $   (.16)
                                                        ========    ========
Diluted:
     Weighted average common shares, basic ..........     14,386      14,334
     Dilutive impact of stock options ...............       --          --
                                                        --------    --------
     Weighted average common shares, diluted ........     14,386      14,334
                                                        ========    ========
     Earnings (loss) per common share, diluted ......   $   (.00)   $   (.16)
                                                        ========    ========
<PAGE>


     For the six months ended June 30, 2008, 395,823 incremental shares from the
     assumed  exercise of stock options and 28,157  restricted  stock awards are
     not included in the  computation  of diluted  earnings per share because of
     the anti-dilutive effect on earnings per share.

5.   In September 2006, the Financial  Accounting  Standards Board (FASB) issued
     SFAS No. 157, "Fair Value Measurements," (SFAS 157), which is effective for
     fiscal years  beginning  after  November  15, 2007 and for interim  periods
     within those  years.  This  statement  defines  fair value,  establishes  a
     framework  for  measuring  fair value and expands  the  related  disclosure
     requirements.  This statement applies under other accounting pronouncements
     that require or permit fair value  measurements.  The statement  indicates,
     among  other  things,  that a  fair  value  measurement  assumes  that  the
     transaction  to sell  an  asset  or  transfer  a  liability  occurs  in the
     principal  market  for the  asset or  liability  or,  in the  absence  of a
     principal market, the most advantageous market for the asset or liability.

     Relative to SFAS 157, the FASB issued FASB Staff  Positions (FSP) 157-1 and
     157-2.  FSP 157-1 amends SFAS 157 to exclude SFAS No. 13,  "Accounting  for
     Leases," (SFAS 13) and its related interpretive  accounting  pronouncements
     that address  leasing  transactions,  while FSP 157-2 delays the  effective
     date of the  application  of  SFAS  157 to  fiscal  years  beginning  after
     November 15, 2008 for all nonfinancial assets and nonfinancial  liabilities
     that are recognized or disclosed at fair value in the financial  statements
     on a nonrecurring basis.

     The Company  adopted SFAS 157 as of January 1, 2008,  with the exception of
     the application of the statement to non-recurring  nonfinancial  assets and
     nonfinancial   liabilities.    Non-recurring    nonfinancial   assets   and
     nonfinancial  liabilities  for which we have not applied the  provisions of
     SFAS 157  include  those  measured  at fair  value in  goodwill  impairment
     testing,  indefinite  lived  intangible  assets  measured at fair value for
     impairment testing, asset retirement obligations initially measured at fair
     value,   and  those  initially   measured  at  fair  value  in  a  business
     combination.

     SFAS 157 establishes a valuation  hierarchy for disclosure of the inputs to
     valuation used to measure fair value. This hierarchy prioritizes the inputs
     into three  broad  levels as  follows.  Level 1 inputs  are  quoted  prices
     (unadjusted) in active markets for identical assets or liabilities. Level 2
     inputs  are quoted  prices for  similar  assets and  liabilities  in active
     markets or inputs that are  observable  for the asset or liability,  either
     directly or indirectly through market corroboration,  for substantially the
     full term of the  financial  instrument.  Level 3 inputs  are  unobservable
     inputs based on our own assumptions  used to measure assets and liabilities
     at fair value. A financial asset or liability's  classification  within the
     hierarchy is determined based on the lowest level input that is significant
     to the fair value measurement.

     The  Company's  interest  rate swap  agreement  is valued at the amount the
     Company  would have expected to pay to terminate  the  agreement.  The fair
     value  determination  was based upon the present  value of expected  future
     cash flows using the LIBOR rate, plus an applicable interest rate spread, a
     technique  classified within Level 2 of the valuation  hierarchy  described
     above.  The fair value at June 30, 2008 was $171,000,  and is included as a
     component of accrued  expenses within the  consolidated  balance sheet. The
     associated fair value  adjustments for the three months ended June 30, 2008
     and the six  months  ended  June 30,  2008,  respectively,  are:  $148,000,
     included as a decrease to interest  expense;  and  $17,000,  included as an
     increase to interest expense.

6.   In June 2008,  the  Company  executed a new credit  agreement  with a bank.
     Under  this  agreement,  the  Company  has  borrowing  availability  up  to
     $20,000,000  in the form of a line of  credit.  This  agreement  allows the
     Company, at its option, to borrow funds at the LIBOR rate plus the
<PAGE>


     applicable  interest rate spread or at the bank's prime lending rate (5.38%
     at June 30, 2008).  This agreement  expires in June 2011. At June 30, 2008,
     there was $7,862,000 outstanding under this agreement. The weighted average
     interest  rate paid by the  Company was 5.2% during  2008.  This  agreement
     contains  certain  loan  covenants  including  leverage  and  fixed  charge
     coverage ratios.  The Company is in compliance with these covenants at June
     30, 2008. This credit facility is secured by certain assets of the Company.

     In 2006,  the Company  borrowed  $6,000,000  under an  unsecured  term loan
     agreement,  executed as an amendment to one of its then bank line of credit
     agreements,  in connection with the asset acquisition for SIVA Corporation.
     The  loan  provides  for  interest  only  payments  in the  first  year and
     escalating  principal payments through 2012. The loan bears interest at the
     LIBOR rate plus the  applicable  interest  rate  spread  (5.38% at June 30,
     2008). The terms and conditions of the line of credit  agreement  described
     above also apply to the term loan.

7.   The Company's  reportable  segments are strategic  business units that have
     separate management teams and infrastructures that offer different products
     and services.

     The Company has two reportable  segments,  Hospitality and Government.  The
     Hospitality   segment  offers  integrated   solutions  to  the  hospitality
     industry.  These offerings  include  industry leading hardware and software
     applications utilized in point-of-sale,  back of store and corporate office
     applications as well as in the hotel/resort/spa  marketplace.  This segment
     also  offers  customer  support  including  field  service,   installation,
     twenty-four hour telephone support and depot repair. The Government segment
     provides  technical  expertise in the  development  of advanced  technology
     prototype  systems  primarily  for the  Department  of  Defense  and  other
     Governmental  agencies.  It provides services for operating and maintaining
     certain  U.S.  Government-owned  communication  and  test  sites,  and  for
     planning,  executing and evaluating  experiments  involving new or advanced
     radar systems. It is also involved in developing technology to track mobile
     chassis. Intersegment sales and transfers are not significant.


<PAGE>


     Information as to the Company's segments is set forth below:

                                                 (in thousands)
                                   For the three months     For the six months
                                       ended June 30,         ended June 30,
                                  ---------------------   ----------------------
                                     2008      2007         2008         2007
                                  ---------------------   ----------------------
  Net revenues:
       Hospitality .............  $  38,480   $  34,420   $  71,792   $  66,655
       Government ..............     18,754      15,452      37,549      31,053
                                  ---------   ---------   ---------   ---------
              Total ............  $  57,234   $  49,872   $ 109,341   $  97,708
                                  =========   =========   =========   =========

  Operating income (loss):
       Hospitality .............  $      58   $  (1,927)  $  (1,981)  $  (4,895)
       Government ..............        943         729       1,873       1,729
       Other ...................         10        (134)        (94)       (271)
                                  ---------   ---------   ---------   ---------
                                      1,011      (1,332)       (202)     (3,437)
  Other income, net ............        229         154         543         394
  Interest expense .............       (121)       (237)       (470)       (459)
                                  ---------   ---------   ---------   ---------
  Income (loss) before provision
    for income taxes ...........  $   1,119   $  (1,415)  $    (129)  $  (3,502)
                                  =========   =========   =========   =========

  Depreciation and amortization:
       Hospitality .............  $     900   $     891   $   1,807   $   1,751
       Government ..............         22           8          49          17
       Other ...................         94          91         189         187
                                  ---------   ---------   ---------   ---------
              Total ............  $   1,016   $     990       2,045   $   1,955
                                  =========   =========   =========   =========

  Capital expenditures:
       Hospitality .............  $     441   $     286   $     543   $     577
       Government ..............         --          --          35          32
       Other ...................         76          31         117          40
                                  ---------   ---------   ---------   ---------
             Total .............  $     517   $     317   $     695   $     649
                                  =========   =========   =========   =========

  Revenues by geographic area:
       United States ...........  $  50,141   $  41,817   $  96,089   $  83,503
       Other Countries .........      7,093       8,055      13,252      14,205
                                  ---------   ---------   ---------   ---------
             Total .............  $  57,234   $  49,872   $ 109,341   $  97,708
                                  =========   =========   =========   =========


     The following table represents identifiable assets by business segment:

                                           (in thousands)
                                       June 30,      December 31,
                                        2008            2007
                                      --------        --------
          Identifiable assets:
              Hospitality ....        $125,190        $122,442
              Government .....          13,154          14,429
              Other ..........           7,117           9,647
                                      --------        --------
          Total ..............        $145,461        $146,518
                                      ========        ========

<PAGE>

     The following table presents  identifiable  assets by geographic area based
on the location of the asset:

                                       (in thousands)
                                 June 30,       December 31,
                                 ---------------------------
                                   2008            2007
                                 --------        ---------

          United States .        $132,588        $134,766
          Other Countries          12,873          11,752
                                 --------        --------
                 Total ..        $145,461        $146,518
                                 ========        ========


     The following table represents Goodwill by business segment:

                                    (in thousands)
                               June 30,    December 31,
                              -------------------------
                                2008           2007
                              -------       ---------

          Hospitality         $26,149        $26,349
          Government .            649            649
                              -------        -------
                 Total        $26,798        $26,998
                              =======        =======


     Customers  comprising  10% or  more of the  Company's  total  revenues  are
summarized as follows:

                                    For the three months     For the six months
                                       ended June 30,           ended June 30,
                                    --------------------    -------------------
                                      2008      2007          2008         2007
                                    --------------------    -------------------

  Restaurant Segment:
       McDonald's Corporation         23%         27%         21%         26%
       YUM! Brands, Inc. ....         16%         14%         14%         13%
  Government Segment:
       Department of Defense          33%         31%         34%         32%
  All Others ................         28%         28%         31%         29%
                                     ---         ---         ---         ---
                                     100%        100%        100%        100%
                                     ===         ===         ===         ===



<PAGE>


Item 2: Management's  Discussion and Analysis of Financial Condition and Results
of Operations

Forward-Looking Statement

     This document contains  "forward-looking  statements" within the meaning of
Section 27A of the  Securities  Act of 1933, as amended,  and Section 21E of the
Securities  Exchange Act of 1934.  Any  statements  in this document that do not
describe  historical  facts  are  forward-looking  statements.   Forward-looking
statements in this document (including  forward-looking statements regarding the
continued  health of the Hospitality  industry,  future  information  technology
outsourcing opportunities,  an expected increase in contract funding by the U.S.
Government, the impact of current world events on our results of operations, the
effects of  inflation  on our  margins,  and the  effects of  interest  rate and
foreign currency fluctuations on our results of operations) are made pursuant to
the safe harbor  provisions of the Private  Securities  Litigation Reform Act of
1995. When we use words such as "intend,"  "anticipate,"  "believe," "estimate,"
"plan,"  "will," or  "expect",  we are  making  forward-looking  statements.  We
believe that the assumptions and expectations  reflected in such forward-looking
statements  are  reasonable,  based on  information  available to us on the date
hereof,  but we cannot assure you that these  assumptions and expectations  will
prove to have been correct or that we will take any action that we presently may
be planning.  We have disclosed  certain  important factors that could cause our
actual  future  results  to differ  materially  from our  current  expectations,
including  a decline  in the volume of  purchases  made by one or a group of our
major customers; risks in technology development and commercialization; risks of
downturns in economic conditions  generally,  and in the quick-service sector of
the hospitality market specifically; risks associated with government contracts;
risks associated with competition and competitive  pricing pressures;  and risks
related to foreign  operations.  Forward-looking  statements  made in connection
with  this  report  are  necessarily  qualified  by  these  factors.  We are not
undertaking to update or revise  publicly any  forward-looking  statements if we
obtain new information or upon the occurrence of future events or otherwise.

Overview

     PAR  continues  to be a leading  provider  of  hospitality  solutions  that
feature  software,  hardware  and  professional/lifecycle  support  services  to
several industries including: restaurants, hotels/resorts/spas, cruise lines and
specialty retailers.  The Company also provides the Federal Government,  and its
agencies,   applied   technology  and  technical  services  primarily  with  the
Department of Defense.

     The  Company's  hospitality  technology  products  are used in a variety of
applications by thousands of customers.  The Company faces competition in all of
its markets  (restaurants,  hotels, etc.) and competes primarily on the basis of
product design/features,  product quality/reliability,  price, customer service,
and delivery  capability.  Recently,  the trend in the hospitality  industry has

<PAGE>

been for users to reduce their number of approved vendors to companies that have
global capabilities,  can achieve quality and delivery standards,  have multiple
product  offerings,  R&D capability,  and can be competitive with their pricing.
PAR  believes  that its global  reach as a  technology  provider is an important
competitive  advantage as it allows the Company to provide innovative solutions,
with significant delivery capability,  globally, to its multinational  customers
like McDonald's, Yum! Brands and the Mandarin Oriental Hotel Group.

     PAR's strategy is to provide completely  integrated  technology systems and
services  with a high  level of  customer  service  in the  markets  in which it
competes.  The Company  conducts its research and development  efforts to create
innovative technology that meet and exceed our customers'  requirements and also
have high  probability  for broader market appeal and success.  PAR focuses upon
operating   efficiencies  and  controlling   costs.  This  is  achieved  through
investment  in  modern  production  technologies,  and  by  managing  purchasing
processes and functions.

     In 2007,  the Company  undertook an internal  investment  strategy in three
distinct areas of its hospitality  segment.  First, the Company made significant
investments  in  developing  its next  generation  software.  Additionally,  the
Company  invested  in  building a more  robust,  further  reaching  distribution
channel. Lastly, as the Company's customers expand in international markets, PAR
has   invested   in   creating  an   international   infrastructure,   initially
concentrating  on the  Asia/Pacific  rim due to the new  restaurant  growth  and
concentration of PAR customers in that region.

     Approximately 34% of the Company's revenues are generated in our Government
Business segment. This segment is comprised of two subsidiaries:  PAR Government
Systems Corporation and Rome Research Corporation.  Through these two government
contractors,  the Company provides IT and communications support services to the
U.S.  Navy,  Air  Force  and Army.  PAR also  offers  its  services  to  several
non-military  U.S.  federal,  state and local  agencies.  The  Company  provides
applied  technology  services  including  radar,  image and  signal  processing,
logistics  management  systems,  and  geospatial  services  and  products.   The
Company's  record setting  Government  performance  rating allows the Company to
consistently   win  repeat  business  and  establish   long-term   client-vendor
relationships  with their  contract  customers.  PAR  provides  its  clients the
technical expertise necessary to facilitate and operate complex systems utilized
by government agencies.

     The Company will continue to leverage its core technical  capabilities  and
performance  into related  technical  areas and an expanding  customer base. The
Company will seek to accelerate  this growth through  strategic  acquisitions of
businesses that broaden the Company's technology and/or business base.

<PAGE>

Summary

     The Company believes it can be successful in its two core business segments
- Hospitality and Government  Contracting Services - due to its capabilities and
industry  expertise.  PAR  remains  committed  to  streamlining  operations  and
improving return on invested capital through a variety of initiatives.

Results of Operations --
Three Months Ended June 30, 2008 Compared to Three Months Ended June 30, 2007

     The Company  reported  revenues of $57.2 million for the quarter ended June
30,  2008,  an increase of 15% from the $49.9  million  reported for the quarter
ended June 30, 2007.  The  Company's  net income for the quarter  ended June 30,
2008 was $674,000, or $.05 diluted earnings per share, compared to a net loss of
$1 million and a $.07 diluted net loss per share for the same period in 2007.

     Product revenues from the Company's  Hospitality segment were $20.8 million
for the quarter  ended June 30, 2008,  an increase of 13% from the $18.3 million
recorded in 2007. This increase was due to a 31% improvement in domestic product
sales  primarily  due to  sales  to  McDonald's,  YUM!  Brands,  and  other  new
restaurant customers.  This increase in domestic revenue was partially offset by
a 21% decline in  international  product  sales.  This  decrease  was due to the
timing of restaurant customer orders in Asia and Canada.

     Customer service  revenues are also generated by the Company's  Hospitality
segment.  The  Company's  service  offerings  include   installation,   software
maintenance,  training, twenty-four hour help desk support and various depot and
on-site service  options.  Customer  service revenues were $17.7 million for the
quarter ended June 30, 2008, a 10% increase from $16.1 million  reported for the
same period in 2007.  The growth is  primarily  related to  increases in several
service areas including onsite contracts, installation, and professional service
activities.

     Contract revenues from the Company's  Government segment were $18.8 million
for the quarter  ended June 30,  2008,  an increase of 21% when  compared to the
$15.5 million  recorded in the same period in 2007.  This increase was primarily
due to the start of new contracts in both the information technology outsourcing
and imaging  information  areas,  including the timing of  subcontract  work and
material buys on these new contracts.  These outsourcing  operations provided by
the Company  directly  support U.S. Navy, Air Force and Army  operations as they
seek to convert their military information technology  communications facilities
into  contractor-run  operations and to meet new  requirements  with  contractor
support.  The imaging  information  work of the Company includes high technology
research involving information archive and retrieval as well as sensors.

<PAGE>

         Product margins for the quarter ended June 30, 2008 were 39.2%, a
decrease of 240 basis points from the 41.6% for the quarter ended June 30, 2007.
This decrease in margins was due to lower margins on increased hardware sales to
McDonald's in the quarter ended June 30, 2008 partially offset by an increase in
higher margin software sales to various restaurant customers as compared to the
previous quarter.

     Customer service margins were 27.4% for the quarter ended June 30, 2008, an
increase  of 120 basis  points  compared  to 26.2% for the same  period in 2007.
Service margins increased primarily due to improved margins in field service and
installation as revenue and productivity increased in both of these areas.

     Contract margins were 5.6% for the quarter ended June 30, 2008, an increase
of 40 basis points  compared to 5.2% for the same period in 2007.  This increase
was due to slightly  higher margins on certain fixed price  contracts.  The most
significant  components of contract costs in 2008 and 2007 were labor and fringe
benefits.  For 2008,  labor and fringe  benefits  were  $12.8  million or 72% of
contract  costs  compared to $11.4 million or 78% of contract costs for the same
period in 2007.

     Selling,  general and administrative  expenses are virtually all related to
the Company's Hospitality segment.  Selling, general and administrative expenses
for the quarter ended June 30, 2008 were $8.7 million, a decrease of 5% from the
$9.2 million for the same period in 2007.  This  decrease  resulted from several
factors  including  a decline  in bad debts,  benefit  costs,  and stock  option
expense.

     Research  and  development  expenses  relate  primarily  to  the  Company's
Hospitality segment. Research and development expenses were $3.9 million for the
quarter ended June 30, 2008, a decrease of 11% from the $4.4 million recorded in
2007. The decrease was primarily  attributable to the near completion of certain
software development projects.

     Amortization of identifiable intangible assets was $389,000 for the quarter
ended June 30,  2008,  virtually  unchanged  from 2007.  Amortization  is on the
identifiable assets acquired in the Company's acquisitions over the last several
years.

     Other  income,  net,  was  $229,000  for the  quarter  ended June 30,  2008
compared  to  $154,000  for the same  period  in 2007.  Other  income  primarily
includes  rental income and foreign  currency gains and losses.  The increase is
due to various factors including rental income.

     Interest expense  represents  interest charged on the Company's  short-term
borrowing  requirements from banks and from long-term debt. Interest expense was
$121,000  for the  quarter  ended June 30, 2008 as compared to $237,000 in 2007.

<PAGE>

The decline is primarily due to a reversal of interest expense recorded in prior
periods  related to the Company's  interest rate swap agreement that was entered
into in September  2007.  In addition,  the  Company's  average  borrowing  rate
decreased in 2008 compared to 2007. This was partially  offset by an increase in
the Company's average borrowings in 2008 when compared to 2007.

     For the  quarters  ended June 30,  2008 and 2007,  the  Company's  expected
effective income tax rate based on projected pre-tax income was 39.8% and 27.8%,
respectively.  The increase in effective tax rate is primarily  attributable  to
the expiration of the Research and  Experimental  Tax Credit at the end of 2007.
Also  contributing to the increase in effective tax rate was the taxable portion
of the proceeds from the voluntary  conversion of a Company-owned life insurance
policy in the  quarter  ended June 30,  2008.  Due to the  pre-tax  loss for the
quarter ended June 30, 2007, the Company  provided a tax benefit of 27.8% as its
estimate  of the annual  effective  income tax rate based on  projected  pre-tax
income as indicated above.

Results of Operations --
Six Months Ended June 30, 2008 Compared to Six Months Ended June 30, 2007

     The Company  reported  revenues of $109.3  million for the six months ended
June 30, 2008,  an increase of 12% from the $97.7  million  reported for the six
months ended June 30, 2007. The Company's net loss for the six months ended June
30, 2008 was $71,000,  or ($0.00) diluted net loss per share,  compared to a net
loss of $2.3  million and $.16 diluted net loss per share for the same period in
2007.

     Product revenues from the Company's  Hospitality segment were $37.6 million
for the six months ended June 30,  2008,  an increase of 7% from the $35 million
recorded in 2007.  This  increase was due to a 16% increase in domestic  product
sales  primarily due to solution sales to new  restaurant  customers and to YUM!
Brands. This increase in domestic revenue was partially offset by a 13% decrease
in  international  product sales.  This decrease was the result of the timing of
orders from the Company's restaurant customers in Asia and Canada.

     Customer service  revenues are also generated by the Company's  Hospitality
segment.  The  Company's  service  offerings  include   installation,   software
maintenance,  training, twenty-four hour help desk support and various depot and
on-site service  options.  Customer  service revenues were $34.1 million for the
six months ended June 30, 2008, an 8% increase  from $31.6 million  reported for
the same period in 2007.  The growth is primarily  related to increases in field
service and installation revenue primarily with McDonald's and YUM! Brands. Also
contributing to the growth was an increase in software maintenance contracts.
<PAGE>

     Contract revenues from the Company's  Government segment were $37.5 million
for the six months ended June 30, 2008,  an increase of 21% when compared to the
$31.1  million  recorded in the same period in 2007.  The increase was primarily
due to new  contracts  in the  information  technology  outsourcing  and imaging
information areas.

     Product  margins  for the six months  ended June 30,  2008 were  41.5%,  an
increase  of 150 basis  points  from the 40% for the six  months  ended June 30,
2007.  The  improved  margins were the result of higher  software  sales in 2008
compared to 2007.

     Customer Service margins were 25.7% for the six months ended June 30, 2008,
an  increase  of 170 basis  points  compared to 24% for the same period in 2007.
This increase is due to an increase in margins in field service and installation
as revenue and productivity rose in both of these areas.

     Contract  margins  were 5.3% for the six  months  ended  June 30,  2008,  a
decline of 60 basis points versus 5.9% for the same period in 2007. The decrease
was  due  to a  favorable  cost  share  adjustment  on the  Company's  Logistics
management program in 2007. The most significant components of contract costs in
2008 and 2007 were  labor  and  fringe  benefits.  For  2008,  labor and  fringe
benefits were $26.4 million or 74% of contract  costs  compared to $24.1 million
or 82% of contract costs for the same period in 2007.

     Selling,  general and administrative  expenses are virtually all related to
the Company's Hospitality segment.  Selling, general and administrative expenses
for the six months  ended June 30, 2008 were $17.8  million,  a decrease of .5 %
from the $17.9 million for the same period in 2007. This decrease  resulted from
several factors  including a decline in benefit costs,  stock option expense and
bad  debts.  This  was  partially  offset  by the  Company's  investment  in the
expansion of its dealer channel.

     Research  and  development  expenses  relate  primarily  to  the  Company's
Hospitality  segment.  Research and development expenses were $8 million for the
six months ended June 30, 2008, a decrease of 2% from the $8.2 million  recorded
in 2007.  The decrease was  primarily  attributable  to the near  completion  of
certain software development projects.

     Amortization  of  identifiable  intangible  assets was $779,000 for the six
months  ended June 30,  2008  compared  to $784,000  for 2007.  This  relates to
amortization of intangible  assets acquired in the Company's  acquisitions  over
the last several years.

     Other  income,  net,  was  $543,000  for the six months ended June 30, 2008
compared  to  $394,000  for the same  period  in 2007.  Other  income  primarily
includes rental income and foreign  currency gains and losses.  This increase is
primarily  due to  higher  foreign  currency  gains  and  rental  income in 2008
compared to 2007.

     Interest expense  represents  interest charged on the Company's  short-term
borrowing  requirements from banks and from long-term debt. Interest expense was
$470,000 for the six months ended June 30, 2008 as compared to $459,000 in 2007.
<PAGE>

The Company  experienced higher average borrowings in 2008 when compared to 2007
under  its lines of  credit  with  banks.  This is  partially  offset by a lower
average borrowing rate in 2008 when compared to 2007.

     For the six months ended June 30, 2008, the Company's  effective income tax
rate was 45%,  compared to 33.5% in 2007.  The increase in effective tax rate is
primarily  attributable to the expiration of the Research and  Experimental  Tax
Credit at the end of 2007.  Also  contributing  to the increase in effective tax
rate was the taxable portion of the proceeds from the voluntary  conversion of a
Company-owned life insurance policy in 2008. Due to the pre-tax loss for the six
months ended June 30, 2008 and 2007,  the Company  provided a tax benefit of 45%
and 33.5%, respectively, as its estimate of the annual effective income tax rate
based on projected pre-tax income as indicated above.

Liquidity and Capital Resources

     The  Company's  primary  sources  of  liquidity  have  been  cash flow from
operations and lines of credit with various  banks.  Cash used by operations was
$6.7 million for the six months ended June 30, 2008 compared to cash provided by
operations of $1.9 million for 2007. In 2008, cash was impacted by the timing of
payments  to vendors  and a growth in  accounts  receivable.  In 2007,  cash was
generated through collection of accounts  receivable.  This was partially offset
by a growth in inventory and the timing of payments to vendors.

     Cash  generated  by  investing  activities  was $233,000 for the six months
ended June 30, 2008 versus cash used in investing activities of $1.4 million for
the same period in 2007.  In 2008,  the Company  received  $1.6 million from the
voluntary  conversion of a Company-owned life insurance policy. In 2008, capital
expenditures  were $695,000 and were  primarily for  manufacturing  and computer
equipment.  Capitalized  software  costs  relating  to software  development  of
Hospitality   segment   products  were  $487,000  in  2008.  In  2007,   capital
expenditures  were $649,000 and were principally for  manufacturing and research
and  development  equipment.  Capitalized  software  costs  relating to software
development of Hospitality segment products were $730,000 in 2007.

     Cash provided by financing  activities  was $5.2 million for the six months
ended June 30, 2008 versus cash used in financing  activities of $1.6 million in
2007. In 2008, the Company  increased its short-term  borrowings by $5.4 million
<PAGE>

and  decreased  its  long-term  debt by  $357,000.  The Company  also  benefited
$195,000  from the  exercise of employee  stock  options.  In 2007,  the Company
decreased its short-term  bank  borrowings by $1.7 million,  benefited  $109,000
from the exercise of employee  stock options and decreased its long-term debt by
$49,000.

     In June 2008,  the  Company  executed a new credit  agreement  with a bank.
Under this agreement, the Company has a borrowing availability up to $20,000,000
in the form of a line of  credit.  This  agreement  allows the  Company,  at its
option,  to borrow  funds at the LIBOR rate plus the  applicable  interest  rate
spread or at the  bank's  prime  lending  rate  (5.38% at June 30,  2008).  This
agreement  expires  in June  2011.  At  June  30,  2008,  there  was  $7,862,000
outstanding under this agreement. The weighted average interest rate paid by the
Company was 5.2% during 2008.  This  agreement  contains  certain loan covenants
including  leverage  and  fixed  charge  coverage  ratios.  The  Company  is  in
compliance  with these  covenants  at June 30,  2008.  This  credit  facility is
secured by certain assets of the Company.

     In 2006,  the Company  borrowed  $6,000,000  under an  unsecured  term loan
agreement,  executed  as an  amendment  to one of its then  bank  line of credit
agreements,  in connection with the asset acquisition for SIVA Corporation.  The
loan  provides  for  interest  only  payments  in the first year and  escalating
principal  payments through 2012. The loan bears interest at the LIBOR rate plus
the  applicable  interest rate spread  (5.38% at June 30,  2008).  The terms and
conditions  of the line of credit  agreement  described  above also apply to the
term loan.

     In September 2007, the Company entered into an interest rate swap agreement
associated  with a $6,000,000  variable  rate loan with  principal  and interest
payments due through August 2012. At September 30, 2007, the notional  principal
amount  totaled  $6,000,000.  This  instrument  was  utilized  by the Company to
minimize significant unplanned fluctuations in earnings and cash flows caused by
interest rate  volatility.  The Company did not adopt hedge accounting under the
provision of FASB Statement No 133,  Accounting for Derivative  Instruments  and
Hedging Activities, but rather records the fair market value adjustments through
the consolidated statements of operations each period. The associated fair value
adjustments  for the three  months  ended June 30, 2008 and the six months ended
June 30, 2008, respectively,  are: $148,000,  included as a decrease to interest
expense; and $17,000, included as an increase to interest expense.

     The  Company  has a  $1,806,000  mortgage  collateralized  by certain  real
estate.  The annual mortgage payment  including  interest totals  $226,000.  The
mortgage bears interest at a fixed rate of 7% and matures in 2010.

     During  fiscal  year  2008,  the  Company   anticipates  that  its  capital
requirements  will be $2 - $3 million.  The Company does not usually  enter into
<PAGE>

long term contracts with its major Hospitality  segment  customers.  The Company
commits to purchasing  inventory  from its suppliers  based on a combination  of
internal  forecasts and the actual orders from  customers.  This process,  along
with good relations with  suppliers,  minimizes the working  capital  investment
required  by the  Company.  Although  the  Company  lists two  major  customers,
McDonald's and Yum!  Brands,  it sells to hundreds of individual  franchisees of
these corporations, each of which is individually responsible for its own debts.
These  broadly  made sales  substantially  reduce  the  impact on the  Company's
liquidity if one individual  franchisee reduces the volume of its purchases from
the Company in a given year. The Company, based on internal forecasts,  believes
its existing cash, line of credit facilities and its anticipated  operating cash
flow will be sufficient to meet its cash requirements  through at least the next
twelve months.  However,  the Company may be required,  or could elect,  to seek
additional funding prior to that time. The Company's future capital requirements
will depend on many factors including its rate of revenue growth, the timing and
extent of spending to support product  development  efforts,  expansion of sales
and marketing,  the timing of  introductions of new products and enhancements to
existing  products,  and market  acceptance of its products.  The Company cannot
assure that additional  equity or debt financing will be available on acceptable
terms or at all. The Company's  sources of liquidity  beyond twelve  months,  in
management's  opinion,  will be its cash  balances  on hand at that time,  funds
provided  by  operations,  funds  available  through its lines of credit and the
long-term credit facilities that it can arrange.

Recent Accounting Pronouncements

     In September 2006, the FASB issued SFAS No. 157, "Fair Value  Measurements"
("SFAS 157"), which provides guidance for measuring the fair value of assets and
liabilities,   as  well  as  requires  expanded  disclosures  about  fair  value
measurements.  SFAS 157 indicates that fair value should be determined  based on
the  assumptions  marketplace  participants  would use in  pricing  the asset or
liability,  and provides  additional  guidelines to consider in determining  the
market-based  measurement.  The Company  adopted SFAS 157 as of January 1, 2008,
with  the  exception  of the  application  of  the  statement  to  non-recurring
nonfinancial  assets  and  nonfinancial  liabilities.  Refer  to  Note  5 to the
Unaudited Interim Consolidated Financial Statements for additional discussion on
fair value measurements. This did not have a material impact on the consolidated
financial statements.

     In February  2007, the FASB issued SFAS No. 159, "The Fair Value Option for
Financial Assets and Financial  Liabilities"  ("SFAS 159"). SFAS 159 permits all
entities to choose to measure eligible items at fair value at specified election
dates.  SFAS 159 is  effective as of the  beginning of an entity's  first fiscal
year that begins after  November 15,  2007.  The Company  adopted SFAS 159 as of
January  1,  2008  and has  elected  not to  measure  any  additional  financial
instruments  and other items at fair value.  This did not have a material impact
on the consolidated financial statements.
<PAGE>

     In December  2007,  the FASB issued SFAS No.141  (revised  2007),  Business
Combinations  (SFAS  141(R)).  The objective of this Statement is to improve the
relevance,  representational  faithfulness, and comparability of the information
that a reporting  entity  provides  in its  financial  reports  about a business
combination.  Specifically,  it establishes principles and requirements over how
the acquirer (1) recognizes and measures the identifiable  assets acquired,  the
liabilities  assumed,  and any  noncontrolling  interest  in the  acquiree;  (2)
recognizes and measures goodwill acquired in the business  combination or a gain
from a bargain  purchase,  and; (3) determines  what  information to disclose to
enable users of the  financial  statements  to evaluate the nature and financial
effects of the business  combination.  This  Statement  is effective  for fiscal
years  beginning  after  December 15, 2008  (fiscal  year 2009).  The Company is
currently  assessing  the impact of  adopting  SFAS  141(R) on its  consolidated
financial statements.

     In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated  Financial  Statements  an amendment of ARB No. 51 (SFAS 160).  The
objective of this  Statement  is to improve the  relevance,  comparability,  and
transparency of the financial  information  that a reporting  entity provides in
its consolidated  financial statements by establishing  accounting and reporting
standards for the noncontrolling  interest in a subsidiary  (minority interests)
and for the  deconsolidation  of a subsidiary.  This  Statement is effective for
fiscal years,  and interim  periods within those fiscal years,  beginning  after
December  15, 2008 (fiscal year 2009).  The Company is currently  assessing  the
impact of adopting SFAS 160 on its consolidated financial statements.

     In March 2008, the FASB issued SFAS No. 161,  "Disclosures about Derivative
Instruments  and Hedging  Activities,  an amendment of FASB  Statement  No. 133"
(SFAS 161).  This  statement  is intended to improve  transparency  in financial
reporting  by  requiring   enhanced   disclosures  of  an  entity's   derivative
instruments and hedging  activities and their effects on the entity's  financial
position,  financial  performance,  and  cash  flows.  SFAS 161  applies  to all
derivative  instruments within the scope of SFAS 133, "Accounting for Derivative
Instruments and Hedging  Activities" (SFAS 133) as well as related hedged items,
bifurcated  derivatives,  and nonderivative  instruments that are designated and
qualify as hedging  instruments.  Entities with instruments  subject to SFAS 161
must  provide more robust  qualitative  disclosures  and  expanded  quantitative
disclosures. SFAS 161 is effective prospectively for financial statements issued
for fiscal years and interim  periods  beginning after November 15, 2008 (fiscal
year  2009),  with  early  application  permitted.   The  Company  is  currently
evaluating the disclosure implications of this statement.

<PAGE>

Critical Accounting Policies

     In our Annual Report on Form 10-K for the year ended  December 31, 2007, we
disclose accounting policies,  referred to as critical accounting policies, that
require  management  to use  significant  judgment or that  require  significant
estimates.  Management  regularly  reviews the selection and  application of our
critical  accounting  policies.  There  have  been no  updates  to the  critical
accounting  policies  contained  in our Annual  Report on Form 10-K for the year
ended December 31, 2007.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

INFLATION

     Inflation  had little effect on revenues and related costs during the first
six months of 2008.  Management  anticipates  that margins will be maintained at
acceptable levels to minimize the affects of inflation, if any.

INTEREST RATES

     As of June 30,  2008,  the Company has $4.7  million in variable  long-term
debt and $8.7 million in variable  short-term debt. The Company believes that an
adverse  change in interest  rates of 100 basis points would not have a material
impact on our  business,  financial  condition,  results of  operations  or cash
flows.

FOREIGN CURRENCY

     The Company's  primary exposures relate to certain  non-dollar  denominated
sales and operating  expenses in Europe and Asia.  These primary  currencies are
the Euro, the Australian  dollar and the Singapore dollar.  Management  believes
that foreign currency  fluctuations  should not have a significant impact on our
business,  financial conditions,  and results of operations or cash flows due to
the low volume of business affected by foreign currencies.

Item 4. Controls and Procedures

     (a) Evaluation of Disclosure Controls and Procedures.

     As of the  end of the  period  covered  by  this  report,  our  management,
including our Chief Executive Officer and Chief Financial  Officer,  carried out
an evaluation of the  effectiveness  of the Company' s "disclosure  controls and
procedures"  (as defined in the Securities  Exchange Act of 1934 Rules 13a-15(e)
and 15d-15(e)) of the Company. These officers have concluded that our disclosure
controls and  procedures  are  effective.  As such, we believe that all material
information  relating  to us and our  consolidated  subsidiaries  required to be
disclosed in our periodic  filings with the Securities  and Exchange  Commission
(i) is recorded,  processed,  summarized  and reported  within the required time
period,  and (ii) is accumulated and  communicated to the Company's  management,
including  our  Chief  Executive  Officer  and  Chief  Financial   Officer,   as
appropriate,  to allow  timely  decisions  regarding  required  disclosure.
<PAGE>

     (b) Changes in Internal Control over Financial Reporting.

     There was no change  in the  Company's  internal  controls  over  financial
reporting,  as defined in Rule  13a-15(f) of the Exchange Act during the quarter
ended June 30, 2008 that has  materially  affected,  or is reasonably  likely to
materially affect, such internal controls over financial reporting.

                           PART II - OTHER INFORMATION

Item 1A.  Risk Factors

     The Company is exposed to certain risk  factors that may effect  operations
and/or  financial  results.  The  significant  factors  known to the Company are
described in the Company's most recently filed Annual Report on Form 10-K. There
have been no material  changes from the risk factors as previously  disclosed in
the Company's Annual Report on Form 10-K.

Item 4.  Submission of Matters to a Vote of Security Holders

     None.


Item 5.  Other Information

     On April 29, 2008,  PAR Technology  Corporation  furnished a report on Form
8-K pursuant to its results of operations for the quarterly  period ending March
31, 2008.

     On June 20, 2008, PAR Technology Corporation furnished a report on Form 8-K
pursuant  to Items 1.01  (Entry  into a  Material  Definitive  Agreement);  1.02
(Termination of a Material Definitive Agreement); and 2.03 (Creation of a Direct
Financial  Obligation or an Obligation under an Off-Balance Sheet Arrangement of
a Registrant).




<PAGE>


Item 6.  Exhibits

                                List of Exhibits


          Exhibit No.          Description of Instrument
          -----------          -------------------------

             31.1        Certification of Chairman of the Board
                         and Chief Executive Officer Pursuant
                         to Section 302 of the Sarbanes-Oxley Act
                         of 2002.

             31.2        Certification of Vice President, Chief
                         Financial Officer and Treasurer Pursuant
                         to Section 302 of the Sarbanes-Oxley Act
                         of 2002.

             32.1        Certification of Chairman of the Board
                         and Chief Executive Officer and
                         Vice President, Chief Financial Officer
                         and Treasurer Pursuant to 18 U.S.C.
                         Section 1350, as Adopted Pursuant to
                         Section 906 of the Sarbanes-Oxley Act of 2002.


<PAGE>
                                   SIGNATURES




Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.











                                        PAR TECHNOLOGY CORPORATION
                                        --------------------------
                                               (Registrant)









Date:  August 11, 2008



                                        RONALD J. CASCIANO
                                        -------------------------------
                                        Ronald J. Casciano
                                        Vice President, Chief Financial Officer
                                        and Treasurer



<PAGE>
                                  Exhibit Index




                                                                 Sequential
                                                                   Page
 Exhibit                                                          Number
 -------                                                          ------


  31.1           Certification of Chairman of the Board             E-1
                 and Chief Executive Officer Pursuant
                 to Section 302 of the Sarbanes-Oxley Act
                 of 2002.

  31.2           Certification of Vice President, Chief             E-2
                 Financial Officer and Treasurer Pursuant
                 to Section 302 of the Sarbanes-Oxley Act
                 of 2002.

  32.1           Certification of Chairman of the Board             E-3
                 and Chief Executive Officer and
                 Vice President, Chief Financial Officer
                 and Treasurer Pursuant to 18 U.S.C.
                 Section 1350, as Adopted Pursuant to
                 Section 906 of the Sarbanes-Oxley Act of 2002.


<PAGE>
                                  Exhibit 31.1

                           PAR TECHNOLOGY CORPORATION
                         STATEMENT OF EXECUTIVE OFFICER

I, John W. Sammon certify that:

1.   I have reviewed this report on Form 10-Q of PAR Technology Corporation;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material  fact or omit to state a  material  fact  necessary  to make the
     statements made, in light of the circumstances  under which such statements
     were made,  not  misleading  with  respect  to the  period  covered by this
     report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in  this  report,  fairly  present  in all  material
     respects the financial  condition,  results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

4.   The  registrant's  other  certifying  officer  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules  13a-15(e) and 15d-15(e))  and internal  control over
     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and
     15d-15(f)), for the registrant and have:

     a.   Designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;

     b.   Designed such internal  control over  financial  reporting,  or caused
          such internal  control over  financial  reporting to be designed under
          our  supervision,   to  provide  reasonable  assurance  regarding  the
          reliability  of financial  reporting and the  preparation of financial
          statements for external purposes in accordance with generally accepted
          accounting principles;

     c.   Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluations; and

     d.   Disclosed  in this  report  any  change in the  registrant's  internal
          control over financial reporting that occurred during the registrant's
          most recent fiscal  quarter and that has  materially  affected,  or is
          reasonably  likely to materially  affect,  the  registrant's  internal
          control over financial reporting.

5.   The registrant's other certifying officer and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors:

     a.   All significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
          record, process, summarize and report financial information; and

     b.   Any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          control over financial reporting.


Date: August 11, 2008
                                           John W. Sammon
                                           -------------------------------
                                           John W. Sammon
                                           Chairman of the Board and
                                           Chief Executive Officer

                                       E-1
<PAGE>

                                  Exhibit 31.2

                           PAR TECHNOLOGY CORPORATION
                         STATEMENT OF EXECUTIVE OFFICER

I, Ronald J. Casciano, certify that:

1.   I have reviewed this report on Form 10-Q of PAR Technology Corporation;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material  fact or omit to state a  material  fact  necessary  to make the
     statements made, in light of the circumstances  under which such statements
     were made,  not  misleading  with  respect  to the  period  covered by this
     report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in  this  report,  fairly  present  in all  material
     respects the financial  condition,  results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

4.   The  registrant's  other  certifying  officer  and  I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules  13a-15(e) and 15d-15(e))  and internal  control over
     financial  reporting  (as  defined  in  Exchange  Act Rules  13a-15(f)  and
     15d-15(f)), for the registrant and have:

     a.   Designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;

     b.   Designed such internal  control over  financial  reporting,  or caused
          such internal  control over  financial  reporting to be designed under
          our  supervision,   to  provide  reasonable  assurance  regarding  the
          reliability  of financial  reporting and the  preparation of financial
          statements for external purposes in accordance with generally accepted
          accounting principles;

     c.   Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluations; and

     d.   Disclosed  in this  report  any  change in the  registrant's  internal
          control over financial reporting that occurred during the registrant's
          most recent fiscal  quarter and that has  materially  affected,  or is
          reasonably  likely to materially  affect,  the  registrant's  internal
          control over financial reporting.

5.   The registrant's  other certifying  officer and I have disclosed,  based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors:

     a.   All significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
          record, process, summarize and report financial information; and

     b.   Any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          control over financial reporting.

Date: August 11, 2008
                                           Ronald J. Casciano
                                           -------------------------------
                                           Ronald J. Casciano
                                           Vice President, Chief Financial
                                           Officer & Treasurer

                                       E-2
<PAGE>



                                  Exhibit 32.1


                           PAR TECHNOLOGY CORPORATION
                CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


     In connection with the Quarterly Report of PAR Technology  Corporation (the
"Company")  on Form 10-Q for the  quarter  ended June 30, 2008 as filed with the
Securities and Exchange  Commission on the date hereof (the "Report"),  we, John
W.  Sammon,  and Ronald J.  Casciano,  Chairman  of the Board & Chief  Executive
Officer and Vice President,  Chief Financial Officer & Treasurer of the Company,
certify  pursuant to 18 U.S.C.  ss. 1350, as adopted  pursuant to ss. 906 of the
Sarbanes-Oxley Act of 2002, that to the best of our knowledge:


     (1)  The Report fully  complies  with the  requirement  of section 13(a) or
          15(d) of the Securities Exchange Act of 1934, as amended; and

     (2)  The  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
          of the Company.






John W. Sammon
--------------------------
John W. Sammon
Chairman of the Board
& Chief Executive Officer
August 11, 2008

Ronald J. Casciano
--------------------------
Ronald J. Casciano
Vice President, Chief Financial
Officer & Treasurer
August 11, 2008

                                      E-3